Netflix is a service related industry that offers a subscription to its customers in return for unlimited access to different movies, documentaries, and tv shows.

Now lets take a look at the different ratios and analyze Netflix as a whole. First we will start with liquidity ratios.

Both the quick and current ratios started in 2012 at 1.34 and peaked at 1.48 in 2014. These relatively high ratios mean that Netflix has the ability to pay off its debts and obligations easily.

This ratio (debt/equity) is implying that in 2012, Netflix was highly dependent upon borrowing money for its operations. Although the ratio went down by almost double by 2014, it is still relatively high and should be noted.

The fixed asset turnover ratio in 2012 was at 27.41 and rose to 36.73 by 2014. This means that Netflix exhibited a clear ability to generate its net sales from fixed investments. Seeing as the ratio improved from 2012 to 2014 this means that Netflix has been more effective in its investments to generate new cash flow revenues.

Profitability ratios measure a company’s efficiency when it comes to its revenues. They give investors an insiders view of a company’s ability to turn their overall revenues into profits.